The shares of MannKind Corporation (NASDAQ:MNKD) and International Paper Company (NYSE:IP) were among the active stocks of the last trading sessions. MannKind Corporation (NASDAQ:MNKD) declined to -8.98% closing at the price of $1.52 whereas the shares of International Paper Company (NYSE:IP) declined -1.63% with the decrease of -0.71 points closing at the price of $42.82. MannKind Corporation has currently decrease -7.32% in its stock over the period of 6-months while its rival International Paper Company subtracted -19.54% in the previous 6-months.
Now we have to analyze the facts that if the stocks were worthy off investors’ money? The facts to analyze here are risks, profitability, returns and price trends.
Returns and Profitability
Profitability and returns are the main reason of investment, the investors are looking for profits that they get and return they should expect over the period of time.
The first and foremost return that is considered while making an investment is the ROI or Return on Investment. The ROI is the ratio between the profit against the cost of investment. Currently the ROI of MannKind Corporation (NASDAQ:MNKD) is 189.7% while the ROI of International Paper Company (NYSE:IP) is 7.3%. Another figure that is to be considered while analyzing the profitability of a share is its EBITDA margin, MNKD’s EBITDA Margin is -3.67 whereas IP’s is 8.37.
Both the profitability ratios suggest a mixed sentiment for MannKind Corporation (NASDAQ:MNKD) and International Paper Company (NYSE:IP).
EPS & Surprise Factor
MannKind Corporation (NASDAQ:MNKD) reported $-0.16/share EPS for the previous quarter where analysts were predicting an EPS to be $-0.2/share Thus beating the analyst Estimates with a Surprise Factor of 20 Percent. While, International Paper Company (NYSE:IP) reported EPS of $1.19/share in the last quarter. The analysts projected EPS of $1.09/share depicting a Surprise of 9.2 Percent.
Taking a look at Earnings per Share, MannKind Corporation tends to be beating the analyst estimates more than International Paper Company. so MNKD is more profitable than IP.
Technical Analysis of MannKind Corporation & International Paper Company
Moving average convergence divergence (MACD) shows that MannKind Corporation (NASDAQ:MNKD) is on a PRICE RELATIVITY trend While International Paper Company (NYSE:IP) is on PRICE RELATIVITY trend. The trend for the past 10-days shows that the MannKind Corporation was in BEARISH territory and International Paper Company was in BEARISH territory.
MNKD’s current statistics gauge that the stock candle is BEARISH with HIGH volatility. While IP’s candle is BEARISH with HIGH.
EPS Growth Rate: MNKD’s 26.8% versus IP’s 14.99%
Another shareholder value can be analyzed through the EPS growth rate; the next 5 years EPS growth rate is predicted by the analysts after the analyzing the previous trends. The next 5 year EPS growth rate of MannKind Corporation (NASDAQ:MNKD) is predicted at 26.8% while International Paper Company (NYSE:IP) stands at 14.99%. These numbers suggest that MNKD is more suitable investment in terms of EPS growth rate.
Financial Risk and Liquidity Concerns
The current ratio and the debt ratio are the two ratios that show the investor how quickly the company is able to payout its debt and how quickly it can cover its obligations. The current ratio of MNKD stands at 0.5 while IP is at 1.6 whereas the debt ratio of the prior is 0 while the debt ratio of the later is 1.68.
The values of the both ratios suggest that IP is more suitable investment when the liquidity and risk is the main concern.
While making an investment, another main factor to consider before investing is the analyst recommendation on the scale of 1 to 5 where 1 is strong buy, 2 is buy, 3 is hold, 4 is Sell and 5 is strong sell. Analyst recommend 2 for MNKD and 2.1 for IP which means MNKD has Buy rating whereas IP has Hold rating.
Another recommendation of analyst that is to be considered worthy is the price target. The mare price or price trend does not suggest the suitability of a stock. The price target set by analyst is also to be considered while investing as it suggests to what extent the stock will rise or fall in the near future. The price target set for MNKD is $4 which is 62% of its current price while IP has price target of 63.69 which is 32.77% of its current price.
Valuation is the process of determining the company’s worth for an investor, the valuation ratios give an insight to that worthiness.
MNKD currently has price to earning P/E ratio of 0 whereas IP has 12.79 while the forward P/E ratio for the prior stands at 0 and for the later it depicts the value of 7.61.
The price to Book P/B for MNKD is 0, Price to Sale is at 17.12 and for IP these ratios stand at 2.59 and 0.77.